Television's Welfare Kings

by Faye M. Anderson

Corporate welfare kings are about to pull off their biggest scam yet -- a $100 billion rip-off

WASHINGTON -- Everywhere you look in Washington these days, you'll find someone who is out to end welfare as we know it. Problem is, the welfare programs that they want to reform tend to include just Aid to Families with Dependent Children (AFDC), the safety net for mothers and children who are living at or below the poverty level. Well, there's a far more expensive and egregious AFDC program about which we hear precious little -- Aid For Dependent Corporations. The new welfare kings don't live in America's depressed urban and rural areas, and you won't see them at the bus stop. No, these welfare kings wear a spit-shine on their polished wing-tips and whisk from one steel-and-glass tower to the next in chauffeur-driven limousines. And here's the kicker: The corporate welfare kings are about to pull off their biggest scam yet -- a $100 billion rip-off of additional broadcast spectrum in which the unwitting dupes are the American people who own the spectrum.

Congress must reform all welfare programs, including corporate welfare

The story began a few years ago when the Federal Communications Commission embarked on a misguided industrial policy to promote a new kind of television that would offer crisper, more detailed pictures. Known as high definition television or HDTV, this television for the 21st century will require new receivers so anyone who wants to watch it will have to buy a new television set that will cost around $2,500. To ease the transition for the nation's 'struggling' broadcasters (the four major networks posted revenues totaling $14.6 billion in 1994), the FCC decided to give them a second chunk of broadcast spectrum equal in size to the spectrum that they already have. The plan was to continue to use the old spectrum to broadcast with traditional analog technology while making the transition to HDTV. We all know the line about the best laid plans of mice and men (no, I'm not referring to the Disney/ABC deal because there's nothing mickey-mouse about this giveaway). As it often does, technology overtook public policy and rendered obsolete the FCC plan for HDTV. With the advent of digital compression technology, broadcasters discovered that they could use the new spectrum for purposes other than HDTV. Instead of sending out a single HDTV signal, they could use the spectrum to transmit up to six channels of digitally-compressed broadcast or non-broadcast services (read: six new revenue streams), or as many as 72 channels of CD-quality radio. So even though the original plan has been cancelled, the broadcasters are walking the halls of Congress saying, "I want my HDTV spectrum." With the federal coffers bare and Congress calling for shared sacrifice to balance the budget by 2002, it strains credulity that the public interest will somehow be served by giving away a public resource estimated to be worth between $11 billion and $100 billion to subsidize some corporate fat cats. If the new corporate welfare kings don't ante up their fair share, the pending telecommunications legislation, intended to promote fair competition and job creation, will instead shut out new entrants to the digital broadcast market, stifle innovation and economic growth, and confer upon incumbent broadcasters an unfair and unearned advantage over small businesses, and women and minority-owned businesses who just a few months ago paid hundreds of millions of dollars for licenses to provide interactive and wireless communications services. With their gift of new spectrum, broadcasters will be able to provide those same services with no upfront payment to the U.S. Treasury. Congress must protect the public interest and end the reign of the new corporate welfare kings. They must heed the clear message that voters sent in the 1994 mid-term elections to end business as usual and to reform all welfare programs, including corporate welfare. Otherwise, all the talk about welfare reform boils down to this: The rich will get richer. As for the rest of us, we'll get a prettier television picture.

Faye M. Anderson is executive director of the Council of 100, a national network of African American Republicans headquartered in Washington, D.C.

Front Page